New legislation may increase the number of city contracts awarded to minority-owned firms.

The city’s Board of Finance recently approved a proposed ordinance that would require a minimum of two bids from minority contractors for city construction contracts below $50,000. The Board of Aldermen will begin reviewing the proposed ordinance on Nov. 8.

“It protects taxpayer interests in getting the best value through the bids, and it gives minorities the opportunity to compete for work,” said Henry Fernandez, New Haven’s economic development administrator.

Unlike past legislation geared toward spurring minority contracts, the current proposal still offers contracts to the lowest bidder and not a specific number of minority-owned firms.

Only contracts sealed through informal bidding would fall under the new ordinance. The city usually advertises construction projects and receives a number of proposals. For contracts below $50,000, the city solicits bids informally and directly from specific firms. Fernandez said New Haven spends millions of dollars annually on projects under the informal bidding category.

“You wouldn’t want to spend $5,000 advertising bids on a $25,000 project,” Fernandez said.

But informal bidding leads the city to retain the same group of contractors because of their work quality, familiarity with projects and networking.

“Informal bidding by its nature tends to help those companies already getting work,” Fernandez said.

City ordinances once included Section 12 1/4, which reserved a certain percentage of city contracts for minority-owned firms. In 1988, the Associated General Contractors of Connecticut successfully challenged the constitutionality of the law.

Such legal opposition seems unlikely for the new proposal.

“I have heard that the city has worked closely with contractors to develop a very different ordinance, so it is an entirely new case,” said Michael LaVelle, who represented the Associated General Contractors in the trial.

According to the 1988 ruling, the city had not adequately documented a disparity among contracts for minorities before passing Section 12 1/4.

In 1999, Mayor John DeStefano Jr. approved a study demonstrating a disparity that would help the new ordinance stand up in court.

John Farnham, executive director of the Associated General Contractors, said programs for minority contractors can be beneficial.

“Good faith programs are very different from hard, fast quotas for minority contractors,” Farnham said. “We favor anything that will help small contractors compete.”

The Board of Aldermen is expected to approve the ordinance, although possibly with slight alterations. Alderman Willie Greene has proposed that the Commission on Equal Opportunities oversee the program, rather than the Office of Economic Development.

Greene did not return telephone calls Tuesday.

Not all of Greene’s colleagues agree with his proposal.

“His ideas weren’t totally cockamamie, but I think he was barking up the wrong tree,” Alderman Carl Goldfield said.

Goldfield said the program’s progress should be easy to monitor.

“In about a year’s time, we’ll have a yardstick to measure this program, and hopefully it will prove successful,” Goldfield said.